New IEA report finds that strong deployment of renewables is set to curb growth in coal use even as electricity demand surges, with China – the world’s biggest coal consumer – remaining pivotal

After reaching a new high in 2024, global demand for coal is set to level off in the coming years as a surge in renewable power helps to meet soaring demand for electricity around the world, according to an IEA report out today.

Coal 2024 – the new edition of the IEA’s annual coal market report, which analyses the latest trends and updates medium-term forecasts – shows that global coal use has rebounded strongly after plummeting at the height of the pandemic. It is poised to rise to 8.77 billion tonnes in 2024, a record. According to the report, demand is set to stay close to this level through 2027 as renewable energy sources play a greater role in generating power and coal consumption levels off in China.

The electricity sector in China is particularly important to global coal markets, with one out of every three tonnes of coal consumed worldwide burned at a power plant in the country. In 2024, China continued to diversify its power sector, advance the construction of nuclear plants and accelerate its huge expansion of solar PV and wind capacity. This should help limit increases in coal consumption through 2027, according to the report, though it also highlights a number of key uncertainties in its analysis.

Electricity use in a number of countries, including China, is growing at a strong pace due to a combination of factors, including the electrification of services like transport and heating, rising demand for cooling, and increasing consumption from emerging sectors such as data centres. Additionally, weather patterns could drive fluctuations in coal consumption in the short term. According to the report, coal demand in China by 2027 could be up to 140 million tonnes higher or lower than forecast due to weather-related variability in renewable generation.

“The rapid deployment of clean energy technologies is reshaping the global electricity sector, which accounts for two-thirds of the world’s coal use. As a result, our models show global demand for coal plateauing through 2027 even as electricity consumption rises sharply,” said IEA Director of Energy Markets and Security Keisuke Sadamori. “However, weather factors – particularly in China, the world’s largest coal consumer – will have a major impact on short-term trends for coal demand. The speed at which electricity demand grows will also be very important over the medium term.”

In most advanced economies, coal demand has already peaked and is expected to keep decreasing through 2027. The pace of decline will continue to depend on the enactment of strong policies, such as those implemented in the European Union, and the availability of alternative power sources, including cheap natural gas in the United States and Canada.

Meanwhile, demand for coal is still increasing in some emerging economies where electricity demand is rising sharply along with economic and population growth, such as India, Indonesia and Viet Nam. In emerging economies, growth is mainly driven by coal demand from the power sector, although industrial use is also going up.

Coal prices today remain 50% higher than the average seen between 2017 and 2019. Coal production reached an all-time high in 2024, though growth is expected to flatten through 2027 as structural changes take hold.

International trade of coal by volume is also set to reach a record in 2024 of 1.55 billion tonnes. However, looking ahead, global trade volumes are set to shrink, with thermal coal seeing the biggest decline. According to the report, Asia remains the centre of international coal trade, with all of the largest importing countries in the region, including China, India, Japan, Korea and Viet Nam, while the largest exporters include Indonesia and Australia.

More US coal production cuts may be on the horizon, setting up thermal coal supply to potentially be lower than demand starting in late 2025.

US coal producers have been scaling back mining operations since at least mid-2023 in response to lackluster demand. Market participants are continuing to contend with elevated power plant inventories following relatively mild winters and more competitive natural gas prices.

Some producers are signaling more production cuts are coming in the next few months. As a result, the US Energy Information Administration (EIA) recently forecast the country's coal output in 2025 would fall by 7.2pc from this year to 472.3mn short tons (428.5mn metric tonnes), the lowest level in agency data going back to 1949.

But US coal-fired generation and coal consumption is expected to grow modestly next year, to 643.7bn kWh and 409.4mn st, respectively, from 641.6bn kWh and 406mn st in 2024, because of greater electricity and industrial demand. Coal consumption for the electric power sector alone is expected to rise to 371.5mn st from an estimated 369.4mn st in 2024, EIA data show.

Generators are expected to draw from their existing coal inventories for the majority of the year to meet the slightly higher electricity demand, potentially bringing power plant stockpiles down to more normal levels. Coal producers also are expected to have less inventory at mines and loadout facilities as volumes that had been deferred to 2025 are delivered.

If the inventory withdrawals and expected slight increase in domestic consumption are coupled with higher export market prices and demand, "there could be an impetus for a slight ramp-up in domestic production, but currently, that prospect does not appear to be visibly on the horizon", EIA chief economist Jonathan Church said.

For example, Argus assessments for calendar year 2025 API 2 coal swaps averaged $112.85/t from 1-24 December, compared with $104.19/t for all of December last year.

The response from coal producers to any improvement in demand could be uneven, which could constrict competition and boost prices.

While larger producers with longwall mining equipment, primarily in northern Appalachia and the Illinois basin, can somewhat efficiently resume or increase production, other companies may struggle to ramp up operations.

Producers also may not have the financial support to increase coal output. A number of market participants expect smaller producers with higher-cost operations to be forced out of business as major banks continue to pull back on lending money to coal mining companies.

In the nearer term, recent or planned coal mine closures could further limit supply. Alliance Resource Partners said in November that it intends to retire its central Appalachian coal-producing MC Mining complex in Kentucky, and the company has already cut operations to two of its four production units. Earlier in 2024, American Consolidated Natural Resources closed its Pride Mine in western Kentucky and Hallador Energy idled two small Indiana mines in February.

Other producers have scaled back operations but kept mines open. Coal miners worked an average 45.5 hours/wk in October when not adjusted for seasonal factors, preliminary figures from the US Labor Department show. A year earlier, coal miners averaged 48.3 hours/wk.

Producers also have to contend with an uncertain outlook beyond 2025, including an expected shift in environmental policies under president-elect Donald Trump, how new data centers will affect electricity demand, and timelines for installing new generation and transmission upgrades.

Alliant Energy, Vistra Energy, Duke Energy and Louisville Gas & Electric and Kentucky Utilities are among utilities that recently announced plans to potentially delay retiring coal-fired generating units or plans to remodel coal units to co-fired natural gas and coal to try to meet load growth projections for the next few years. This could keep coal-fired generation and demand at least somewhat stable, but it may not provid long-term support.

"To have increased coal demand, you would have to have load growth outpacing new supply," said Robert Godby, associate professor in the economics department at the University of Wyoming. He and others expect new renewable generation and transmission projects to eventually accommodate projected electricity demand growth.

Increased load growth will be "at best just a reprieve from the ongoing downward trend in coal production and coal demand", Godby said.

As such, producers may continue to try to limit output in 2025, which could partially raise domestic prices from current levels that straddle the line of profitability for many coal mining companies. But the increases will likely be modest as alternative energy sources are expected to continue to suppress demand for coal generation.

By Anna Harmon

Coal India subsidiaries--Bharat Coking Coal Ltd (BCCL) and South Eastern Coalfields Ltd (SECL) registered a decline in coal production between April and December of the current fiscal year (FY25). The world's largest state-owned coal producer said in a regulatory filing to the stock exchanges on Wednesday, January 1, that while BCCL's coal production dropped by 2.6 per cent, SECL's fossil fuel output declined by 9.4 per cent.

However, other subsidiaries of the MahaRatna public-sector undertaking (PSU), Northern Coalfields Ltd, Eastern Coalfield Ltd (ECL), Central Coalfields Ltd (CCL) and Western Coalfields registered a growth in production between April-December. Coal India's production in the period under review was 543.4 million tonnes (MT), compared to 531.9 MT in the year-ago period.

In December, the state-run miner produced 72.4 MT of coal, compared to 71.9 MT in the corresponding month of the previous fiscal year. Coal India accounts for over 80 per cent of domestic coal output. The PSU has set a target of producing 838 MT of coal in FY25. It produced 773.6 million tonnes of coal in 2023-24, but fell short of its production target of 780 MT for the fiscal.

Coal India Q2 Results

Coal India announced its July-September quarter results for fiscal 2024-25 (Q2FY25) in October, reporting a decline of 22 per cent in consolidated net profit to ?6,289.10 crore dragged by lower sales of coal and allied products, compared to ?8,048.6 crore in the corresponding period last year.

The state-run miner's revenue from operations in the second quarter of the current fiscal fell 6.4 per cent to ?30,672.9 crore, compared to ?32,776 crore in the year-ago period. The government-owned miner accounts for 80 per cent of the country's domestic coal production.

Coal India has posted a 10 per cent rise in its coal output at 773.6 million tonnes in the 2023-24 fiscal year. However, the output fell short of its 780 MT production target for the 2023-24 financial year. The PSU produced 703.2 MT of coal during the preceding 2022-23 fiscal. On Wednesday, shares of Coal India settled 0.68 per cent higher at ?386.50 apiece on the BSE.

State-run NTPC on Wednesday said that the group’s power generation stood at 326 billion units (BU) for the April-December period in the current financial year, a growth of almost 4 per cent on an annual basis.

The country’s largest power generator also mined around 30.88 million tonnes (MT) of coal from its captive mines during the same nine-month period, growing by 23 per cent year over year.

NTPC coal stations achieved cumulative plant load factor (PLF) of 76.20 per cent by the end of third quarter of FY 2024-25.

By the end of calendar year 2024, NTPC Group’s installed capacity stood at 76,598 megawatts (MW), with an addition of 2,724 MW during the year.

These accomplishments reinforce NTPC’s commitment to delivering reliable and affordable power to the nation.

Apart from the operational capacity of 76.6 gigawatts (GW), an additional 29.5 GW capacity, including 9.6 GW Renewable capacity, is under construction. The company is committed to achieving 60 GW of Renewable Energy capacity by 2032.

NTPC Coal Mining has consistently exceeded its production targets, reinforcing its position as a key player in the captive coal mining sector.

The CPSU dispatched 30.55 MT of coal to NTPC’s power stations, a growth of around 19 per cent compared to the previous financial year.

Till date, NTPC Mining has produced more than 134.87 MT and has despatched more than 132.98 MT of coal from its five operational captive coal mines.

The mines are Pakri Barwadih, Kerandari, and Chatti Bariatu in Jharkhand, Dulanga in Odisha, and Talaipalli in Chhattisgarh.

Jakarta, CNBC Indonesia - Indonesia semakin serius untuk menjalankan program transisi energi. Bahkan, tak tanggung-tanggung, pemerintah kini menargetkan tambahan pembangkit listrik berbasis energi terbarukan dengan kapasitas sebesar 75 Giga Watt (GW) hingga tahun 2040.

Target tersebut setara dengan 75?ri total kapasitas tambahan pembangkit listrik baru yang akan dibangun sampai 2040. Pemerintah rencananya akan membangun tambahan 102 GW kapasitas pembangkit listrik baru sampai 15 tahun mendatang.

Selain 75 GW pembangkit energi terbarukan, selebihnya akan dibangun 22 GW pembangkit listrik berbasis gas bumi dan 5 GW Pembangkit Listrik Tenaga Nuklir (PLTN).

Target tersebut diumumkan oleh Utusan Khusus Presiden untuk Perubahan Iklim dan Energi Hashim Djojohadikusumo saat membuka Paviliun Indonesia pada Konferensi Perubahan Iklim Dunia COP29 di Baku, Azerbaijan, pada 11 November 2024 lalu.

Hashim menyebut, target itu direncanakan tak lain sebagai upaya Indonesia untuk menangkal perubahan iklim global.

"Akan ada program baru yang ditawarkan Pemerintahan Presiden Prabowo kepada dunia. Pertama, akan ada 100 Giga Watt energi baru yang akan diimplementasikan oleh pemerintahan baru dalam 15 tahun ke depan, di mana 75% atau 75 Giga Watt akan berasal dari energi terbarukan," paparnya saat menjadi pembicara kunci saat pembukaan Paviliun Indonesia di COP29 di Baku, Azerbaijan, Senin (11/11/2024).

Detailnya, target 75 GW tersebut akan berasal dari Pembangkit Listrik Tenaga Air (PLTA), Pembangkit Listrik Tenaga Panas Bumi (PLTP), Pembangkit Listrik Tenaga Surya (PLTS). Dan di luar itu, ada tambahan 22 GW berasal dari gas bumi, dan bahkan 5 GW untuk PLTN.

"Ini komitmen kita. Ini komitmen pemerintahan baru," ujarnya.

Investasi Jumbo

Setidaknya, untuk membuat target tersebut tercapai, RI membutuhkan dana hingga US$ 235 miliar atau setara Rp 3.689 triliun (asumsi kurs Rp 15.700 per US$).

"Ambisi ini membutuhkan investasi US$ 235 miliar," imbuh Hashim.

Investasi jumbo dan target untuk kepentingan global itu, dinilai perlu kolaborasi antar negara yang mana artinya Indonesia tidak bisa bekerja sendiri untuk mengatasi perubahan iklim global.

"Satu-satunya cara kita mengatasi ini yaitu dengan kolaborasi antarnegara. Saya percaya kita melakukan ini bukan hanya karena perjanjian internasional, seperti Kyoto Protocol atau Paris Agreement, tapi kita melakukan ini murni karena kita peduli tentang masa depan generasi penerus kita," tandasnya.

Disambut PLN

Direktur Utama PLN Darmawan Prasodjo mengatakan, pihaknya kini tengah menyusun Rencana Usaha Penyediaan Tenaga Listrik (RUPTL). Hingga 2040, diperkirakan akan dibutuhkan tambahan kapasitas pembangkit listrik baru sampai 100 GW.

"Pak Hashim tadi sudah umumkan, sekitar 75?ri tambahan kapasitas pembangkit listrik baru berasal dari energi terbarukan. Artinya, kita sudah bergerak untuk mengurangi emisi gas rumah kaca. Ini berasal dari PLTA, geothermal, dan lainnya," ucapnya saat menjadi pembicara pada panel diskusi di Paviliun Indonesia COP29 di Baku, Azerbaijan, Senin (11/11/2024).

Dia memaparkan, total sekitar 102 GW pembangkit listrik baru akan dibangun selama 2024-2040. Rinciannya, 75 GW dari energi terbarukan, seperti 15 GW dari Pembangkit Listrik Tenaga Bayu/Angin (PLTB), 27 GW PLTS (atau naik menjadi 32 GWh bila menggunakan bateria/ BESS), lalu PLTA 25 GW, 1 GW bioenergi, dan 7 GW dari PLTP atau geothermal. Kemudian, 22 GW dari gas bumi dan 5 GW dari PLTN.

Di kesempatan lain, Darmawan - atau kerap disapa Darmo - pun menyebut, target ini menjadi tantangan sekaligus kesempatan bagi pihaknya dan juga Indonesia untuk berkolaborasi dan menyediakan sumber energi bersih yang murah.

"Dan dalam proses itu, kita akan mampu menciptakan lebih banyak lapangan pekerjaan untuk mengurangi kemiskinan, memberikan kesejahteraan kepada rakyat, dan mewujudkan pertumbuhan ekonomi 8% seperti yang ditargetkan Presiden (Prabowo Subianto)," jelas Darmo dalam acara Electricity Connect 2024, di JCC, Rabu (20/11/2024).

Darmawan memastikan pihaknya akan terus berupaya mencapai target tersebut. Salah satunya, yakni dengan membangun kolaborasi dengan berbagai pihak.

"Dan kita memiliki keyakinan yang kuat, apapun tantangan yang ada di depan, kita akan terus bergerak maju untuk menyelesaikan misi," tambahnya.

Butuh Transmisi 70.000 Km

Selain berencana menambah 100 GW pembangkit listrik baru, Indonesia pun ditargetkan akan membangun jaringan transmisi listrik sepanjang 70.000 kilo meter (km).

"Selama 10 tahun ke depan, ini angka ini sudah kami lakukan simulasikan antara Dirjen Tenaga Listrik dengan tim PLN dan juga ada juga kerjasama dengan International Energy Agency, adalah 53 ribu km transmission line selama 10 tahun. Dan kemudian untuk sampai 2040 adalah 70 ribu km transmission line," kata Darmo.

Darmawan menyebutkan bahwa pemerintah bisa membangun rencana yang sudah disimulasikan tersebut untuk bisa memfasilitasi rencana tambahan bauran energi baru terbarukan di Indonesia secara masif.

"Nah dengan adanya perancangan dan pembangunan transmisi ini, maka pemerintah Indonesia bisa memfasilitasi pembangunan energi baru terbarukan secara masif," tandasnya.

Selain itu, Wakil Menteri ESDM Yuliot Tanjung merinci, Indonesia membutuhkan investasi sebesar Rp 600 triliun untuk bisa membangun pembangkit listrik baru, ditambah investasi sebesar Rp 400 triliun untuk bisa membangun jaringannya transmisi, dalam 10 tahun ke depan.

"Untuk kebutuhan pembangkit untuk 10 tahun ke depan, kita membutuhkan investasi sekitar Rp 600 triliun. Sementara untuk jaringan, kita membutuhkan investasi sekitar Rp 400 triliun. Jadi nanti untuk setiap tahapan, itu nanti kita akan mencoba untuk mendetailkan," beber Yuliot dalam Konferensi Pers Electricity Connect 2024, di JCC, Rabu (20/11/2024).

Pengembangan infrastruktur listrik itu dibutuhkan, seiring dengan meningkatnya permintaan listrik di dalam negeri. Kenaikan dari permintaan listrik dalam negeri didorong oleh meningkatnya produktivitas industri, rumah tangga, hingga kendaraan listrik.

"Kami melihat misalnya di ekosistem kendaraan listrik, itu justru permintaan ke depan itu akan terjadi peningkatan, kemudian kegiatan rumah tangga juga akan terjadi peningkatan, dan juga di industri akan juga terjadi peningkatan," tandasnya.

RUPTL Paling Hijau

Darmawan mengatakan, pihaknya dengan Kementerian Energi dan Sumber Daya Mineral (ESDM) tengah menggodok rencana jangka panjang kelistrikan di Indonesia hingga tahun 2040.

Darmawan mengatakan bahwa pihaknya saat ini tengah menggodok revisi Rencana Usaha Penyediaan Tenaga Listrik (RUPTL) untuk tahun 2024-2033.

Rencananya, RUPTL tersebut akan berlaku selama 10 tahun dengan menambahkan jumlah kapasitas listrik di Indonesia sebesar 68 Giga Watt. Dari jumlah tersebut sebesar 67%-nya berasal dari pembangkit listrik berbasis energi terbarukan.

"Dan saat ini kita sedang menggodok RUPTL dengan total 68 GW antara tahun ini sampai 2033. Dimana 46 GW basis pada renewable energy. Artinya 67% penambahan pembangkit 10 tahun mendatang basis EBT," beber Darmawan dalam Rapat Dengar Pendapat (RDP) dengan Komisi XII DPR RI, Jakarta, Senin (2/12/2024).

Perlu diketahui, berdasarkan data Statistik PLN, total kapasitas pembangkit listrik terpasang nasional hingga Desember 2023, termasuk pembangkit sewa dan pengembang swasta (Independent Power Producers/ IPP) adalah 72.976,30 Mega Watt (MW).

Berdasarkan data Kementerian Energi dan Sumber Daya Mineral (ESDM), total kapasitas pembangkit listrik berbasis Energi Baru Terbarukan (EBT) hingga akhir 2023 tercatat mencapai 13.155 MW.

Dalam kurun waktu lima tahun terakhir, penambahan kapasitas pembangkit EBT sampai 2023 sebesar 3.322 MW, dengan kenaikan rata-rata 6% per tahun.

Adapun hingga 2023, bauran EBT di Tanah Air tercatat baru mencapai 13,09%. Sebelumnya, pemerintah menargetkan bauran EBT bisa mencapai 23% pada 2025 mendatang.